Hong Kong's New Budget to Drive High-Quality Growth
Hong Kong (ANTARA) - Hong Kong will leverage its strong economic expansion to foster innovation in science and technology (iptek) as a new growth driver, said Paul Chan, the Financial Secretary of the Hong Kong Special Administrative Region (SAR) government, when presenting the 2026-2027 budget on Wednesday (Feb 25).
Hong Kong’s operating balance will return to surplus in the fiscal year 2025-2026, supported by increased tax revenue from a rapidly growing economy and capital markets, Chan said.
“Overall, Hong Kong’s public finances have improved significantly,” Chan said, linking the improvement to strengthened fiscal consolidation programs that have replenished Hong Kong’s coffers.
Noting that this year marks the beginning of China’s 15th Five-Year Plan (2026-2030), Chan said Hong Kong will integrate and contribute to overall national development by developing new, high-quality productive forces and helping companies explore new markets.
Hong Kong’s main economic growth in 2026 is projected to be in the range of 2.5 percent to 3.5 percent, while the underlying inflation rate and headline inflation are projected to be 1.7 percent and 1.8 percent, respectively, according to Chan.
The Hong Kong SAR government will promote the full integration of technological innovation and industrial innovation through key infrastructure, including the Hong Kong Park of the Shenzhen-Hong Kong Hetao Innovation Science and Technology Cooperation Zone and the San Tin Technopole, Chan said.
From 2027 to 2030, Hong Kong’s economy is projected to grow by an average of 3 percent per year in real terms, with an average underlying inflation rate of 2 percent per year.
The latest budget reaffirms its commitment to promoting innovation in science and technology, with a focus on artificial intelligence (AI). Hong Kong will promote the use of AI in the industrial sector so that all its citizens can eventually adopt and understand the technology, Chan said.
To this end, Chan said he will establish and lead the Committee on AI+ and Industry Development Strategy to formulate strategies and create favorable conditions for AI to drive the transformation and development of various industries.
To promote the development of AI+ and the transformation of research and development (R&D) results, the Hong Kong Artificial Intelligence Research and Development Institute Company Limited will begin operations in the second half of this year, Chan said.
The Sandy Ridge data center cluster, which can provide a gross floor area of 250,000 square meters, will enhance Hong Kong’s overall computing power. The results of the tender for the site will be announced soon, Chan said.
To accelerate new industrialization, the budget has allocated resources to establish the first national innovation manufacturing center outside mainland China in the Hong Kong SAR.
The Hong Kong SAR government will promote the full integration of technological innovation and industrial innovation through key infrastructure, including the Hong Kong Park of the Shenzhen-Hong Kong Hetao Innovation Science and Technology Cooperation Zone and the San Tin Technopole, Chan said.
In the financial sector, Hong Kong will advance the internationalization of the Renminbi and continue to reform the securities market, Chan said.
The Hong Kong SAR government will this year draft legislation to refine the tax regime for family offices and funds, and establish a licensing regime for digital asset trading and custody service providers.
To help residents of Wang Fuk Court, whose apartment units were destroyed in a deadly fire in November last year, the budget has allocated HK$4 billion (HK$1 = Rp2,149) to support the long-term housing plan announced by the Hong Kong SAR government earlier this month.
According to the budget, the operating balance will record a surplus throughout the period from 2026-2027 to 2030-2031. Meanwhile, the capital balance will record a deficit annually, mainly due to high spending on capital projects.
The Hong Kong SAR government will increase the issuance of bonds to finance infrastructure projects, which are considered investments for the future of Hong Kong. During this period, fiscal reserves are expected to gradually increase to more than HK$700 billion.